Two Sigma Investments co-founder John Overdeck has defended a proposed $723m settlement for his wife Laura as a fair division of wealth accumulated during their 24-year marriage, while disputing her claim to a substantially larger share of his stake in the quantitative hedge fund, according to a report by Bloomberg.
Giving evidence at the couple’s divorce trial in New Jersey Superior Court in Newark, Overdeck said his wife should receive a portion of the increase in the value of his Two Sigma interest during their marriage, but argued that her demand for 35% of the stake was excessive.
Laura Overdeck has valued her husband’s interest in Two Sigma at about $6.2bn and is seeking 35% of that value. John Overdeck puts the value of his holding at closer to $4.9bn.
He said a payment of roughly $600m represented a reasonable share of the appreciation in his Two Sigma interest, with the remainder of his proposed settlement covering other marital assets. The overall offer includes assets that his wife had already withdrawn, including about $75m taken from their accounts shortly before she filed for divorce in January 2022.
Overdeck also addressed his compensation from Two Sigma, saying he received approximately $685m from the firm during the marriage.
He described the compensation arrangement as highly negotiated and said it was substantially greater than the remuneration received by any other employee at the firm. However, he argued that the payments reflected his contribution to the business and were agreed in advance based on measures commonly used for executive compensation.
Overdeck said his role contributed to the investment returns generated by Two Sigma, while acknowledging that he was not responsible for most of the work carried out across the firm.
Although he was the company’s highest-paid individual, he said his compensation represented no more than 10% of the total amount paid out by Two Sigma.
The billionaire co-founder also argued that the growth in his Two Sigma wealth was not solely attributable to his work at the firm. He pointed to broader expansion across the hedge fund industry, advances in technology and rising equity markets as factors that helped drive the value of the business.
Two Sigma, which was established one year before the Overdecks married, managed less than $1bn at the start of their marriage in 2001. The firm now oversees more than $80bn, according to the testimony.
